Ahead of today’s Turkish Central bank decision, analysts were adamant that if Turkey truly wants to ward off currency bears, it would have to deliver a “shock and awe” rate hike, greater than the whisper consensus call for a 100bps, especially since this is the last rate meeting before June 24 elections, at which Erdogan is expected to be granted virtually supreme powers, and has hinted his ambitions to also dominate monetary policy.

Moments ago the CBRT did just that, when it blew the doors off Lira watchers, by hiking the 1-week Repo Rate an enormous 125bps, from 16.50% to 17.75% – greater than any analysts forecast in a Bloomberg survey – thereby sending a very strong signal to the market. According to some desks, this was a “whatever it takes”-message from the central bank which sent markets a strong signal that it means business.

And looking at the more than 2% bullish reversal in the lira, which soared from 4.58 to 4.48 in kneejerk response, the market got the message.

In its statement, the CBRT said that additional ightening may be needed, referencing elevated levels of inflation and inflation expectations which continue to pose risk on pricing behavior. The bank added that it has decided to strengthen monetary tightening to support price stability and will continue using all tools in pursuit of price stability, noting that tight policy stance to be maintained decisively until marked improvement in inflation outlook is observed.